News : MINI makes £250m investment in the UK

The MINI factory in Cowley will receive some of BMW’s £250m investment into the UK

MINI has announced a further £250m investment in its UK manufacturing operations by the end of 2015 at its Cowley factory, steel body pressings operation at Swindon and engine plant at Hams Hall near Birmingham. This is to support the company’s international growth strategy for the MINI brand with increasing volumes and up to 10 different models in the new line-up in the mid-term.

It comes on top of the £500m UK investment announced in June 2011 and means additional job security for the 5500 UK associates working in the UK MINI production network. The announcement was made during a visit to MINI Plant Oxford by Business Secretary, Vince Cable and Harald Krueger, Member of the Board of Management BMW Group, on the day when the Olympic Torch Relay will visit the plant.

‘A year ago we announced a further investment of £500m in our UK production network by 2014 and today we are announcing an additional £250m, taking us through to 2015. This brings the total to £1.75 billion since 2000,’ said Krueger. ‘Over the last eleven years, MINI has been a unique global success and the BMW Group has even greater plans for the future development of the brand. Plant Oxford has played a major role in this with cars being exported to over 100 countries around the world. This additional investment is great news for all our employees in the UK and shows the BMW Group’s commitment to Britain as a vital manufacturing base for us.’

Dr Vince Cable addressed company employees at Oxford, warmly welcoming the new investment, ‘BMW’s ambitious plans for MINI will ensure its UK sites at Oxford, Swindon and Hams Hall remain at the centre of MINI production worldwide. The investment of £250 million in addition to the £500 million last year demonstrates BMW’s commitment to the UK and safeguards jobs for the future.’

The extra volume for the growth strategy of the MINI brand and the complexity of new model lines means that additional production capacity for MINI sales beyond Oxford’s maximum capacity is needed in the medium term and the company is now considering how to achieve this.

‘Our preferred option is to establish a contract manufacturer as a satellite production as close to our UK operations as possible, at the Nedcar plant in The Netherlands, with whom BMW is in discussions.’ explained Krueger. ‘Oxford will provide special MINI production expertise for any new operation, particularly in the areas of dealing with the high complexity and customer individuality which MINI demands and in operating state-of-the-art, multi-model production lines. Just as Munich is the centre of the BMW world, Oxford is and will remain the home and the heart of MINI.’

As the volume and variety of the MINI model line-up grows, there will be additional production requirements for engines and body panels from the BMW Group’s specialist UK facilities in Hams Hall and Swindon. Part of the new investment is to develop specific production facilities to meet these requirements.

MINI’s body pressing plant in Swindon will also benefit…

BMW Group’s contribution to UK economy

A report published by Oxford Economics makes clear the significance of BMW Group’s business operations to the UK economy.

The key findings of the study show:

The activities of BMW Group contribute £1.2 billion each year to UK GDP

For every additional £1 contribution to UK GDP directly generated by the company and its dealer network, £2.20 in GDP is created across the UK economy

BMW Group and its dealer network employ 18,000 people directly while supporting over 46,000 UK jobs in total

80 per cent of MINIs and 90 per cent of Rolls-Royce Motor Cars are exported. In total, £2.4 billion worth of cars and engines are exported each year, accounting for around one per cent of all goods exported by UK companies

BMW Group and its dealer network spend nearly £1.2 billion each year sourcing goods and services from UK-based suppliers through the payment of employee income tax, national insurance contributions, business rates and VAT on vehicle sales, the activities of BMW Group and its dealer network directly contribute over £900 million per annum to the UK Exchequer.

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32 Comments

The Ned Car element is certainly new, I was expecting an expansion of production at Steyr or production of some MINIS in the US.
It seems production efficiency means it makes more sense to find an alternative factory nearer the main UK factories. A modern day Seneffe 🙂
It’s a shame BAE shrunk Cowley down so much though…

BAe was just after getting their cash back. BM are lauging now at the way the Bini is selling. BMW also employ quite a few people at their Thorne base, near Doncaster, which handles all the press fleet for both BMW and Mini, and is the main import centre. If you notice, all the press fleet have Doncaster issued registrations.

The ‘production staff’ must be on short hours at Longbridge, as the lines aren’t really moving. It surely cannot give the staff there much confidence, unlike BMW’s, who can’t seem to make Bini’s fast enough. Cowley actually assembles the whole cars, unlike Longbridge, where the car arrives in a crate from China, via Felixstowe, ready painted, and 85% assembled. And most of the components that are left for the few people to bolt on come in crates from China. UK content is very minimal. It does actually make you wonder why SAIC bother doing the final assembly here, unless it is some form of import tax dodge. If the cars did arrive 100% built, it would make them cheaper to produce.

@10 there is only a handfull on the “line”and several hundred other staff-engineers,designers etc.I cant see the place shutting soon.Im hoping kieth will do an article on anal perspiration soon so i can read your valuable angle on how longbridge may effect it.

@10 the main points about the MG Birmingham plant are 1: design & engineering, and 2: giving the MG car its Britishness / branding which is important to China and even to some UK people. Also the tax thing, Im pretty sure they do get a tax break as a result of the partial assembly. You may also find that there is more British stuff in the car than you think. It is quite likely that some components are sourced from Britain, Germany, Japan, Europe, Australia etc, taken back to the China and fitted ito all cars at the main assembly point.. why… many countries still have local content requirements (pretty sure NZ doesnt, but Aussie does). Most car makes these days have some components from many countries. Land Rovers for example are full of German and Japanese parts and have been for years. it is quite likley that each foreign component is declared to some countries as it is imported to that country to prove that it has local content (or it might be that the get credit for the number of components they buy even if they dont end up back in that country). MG may or may not be worried about slow sales. It might be that if they sell a ‘few’ in the UK Aussie and NZ that they can say to the large numbers of Chinese Buyers….buy Great British car!

Oh about the Bmw Mini, REALLY nice car shame it only has 4 seat belts, else I would have bought one. Had to buy a 318 instead which is also quite good except silly bits fall off it all the time (trim is rubbush) other than it handles well, is Rear wheel Drive (handles like a Jag!), is really economical, and goes like a cut cat. its more reliable at getting off at traffic lights than the tomcat turbo, which I used to stall all the time.alex

@13 Handles nothing like a Jaguar car – they tend to glide then hold the road when you get to the twisty bits- the BMWs have a slightly firmer set up and in my view harder seats. And whilst they are good to drive, you enjoy the drive, get out of the car and you’re ready for the office…

Once again another thread that ends up whinging about MG and Longbridge. The British Motor Industry is in better health now than it has been for over 50 years. Not only is it seeing this massive investment by BMW but Jaguar/Land Rover are going from strength to strength. Why are you bothered that the Chinese are making a hash of selling some down market, bland hatchback? Its of absolutely no consequence

@15 the tory government bunged the firm to BAE for a tenner to wash its hands of the thing,roundabout this time the 200’s and 400’s etc was selling,they broke some sort of promise i cant remember if it was loans or re-investmants and sold it TO BMW for 800-odd million and after BMW plucked the good bits groundhog day came in the guise of P4.

There’s no doubting the MINI success and BMW’s significant contribution to the UK economy.
However, like those before BMW did not seem to have a real interest in sorting the whole company. They took the best bits and departed.
Were British Aerospace ever interested? The Honda years started as joint ventures but once Honda had acquired what it wanted Rover was left topping & tailing pure Hondas – do I need to say it? – HHR !

No, I’m not whinging. Nor am I failing to appreciate the MINI, JLR success stories. The fact remains – Rover could have survived and been another modern day British automotive success. Similarly, MG UK could and should by now have a significant British, European market presence.

From memory the Government sold the Rover Group to British Aerospace in March 1988 for £150m. The deal was completed later on that year. This attracted criticism from the opposition party who felt Rover had been sold at a knock-down price.

As part of the agreement, there was a Restrictive Agreement in place which meant that British Aerospace was not permitted to sell the Rover Group to another party for five years from the date of completion of the deal. This was honoured by British Aerospace who, in the autumn of 1993, started courting potential interested parties to take the Rover Group off their hands, following the huge losses British Aerospace’s aviation interests had made in 1992.

BMW bought the Rover Group for £800m, with the announcement made on 31st January 1994 and the deal completed almost two months later.

@19 i was sure it was a tenner and taking on the debt?perhaps my memory is waning?! In a way,BAE and Rover could be seen as a match made in hell,given the aviation losses way back then and the unforgivable cost overruns on projects such as the nimrod MRA4-billions sunk and now scrapped,to be honest,i think the BAE years was possibly a stable period for Rover.

Interesting to see in Autocar magazine this week that if you add the latest annual UK MINI production numbers to those of JLR (Jaguar, Land-Rover), all once part of British Leyland, you get a total of 700,000 cars built in their combined UK factories, which is actually more than BL managed in any year after 1976……….

Autocar – The British car industry’s good news:
“Fifty years ago our car business was the world’s biggest outside America, but through complacency and incompetence we chucked it away.
The damage started in the ‘60s, accelerated through the ‘70s and ‘80s, and Ford capped things in 2000 by ceasing car manufacture here after 87 years.
By then, luckily, a team of foreign-based companies had moved in. The Japanese embraced the UK as a volume manufacturing site, then BMW, Volkswagen and Tata acquired our leading prestige marques and made them work. Today our industry makes 1.2 million vehicles plus two million engines a year, exports three-quarters of them, employs 770,000 people and feeds £8.5 billion into the economy.”http://www.autocar.co.uk/blogs/confidential/british-car-industrys-good-news-today

I also saw the Autocar article. Some fascinating statistics here. JLR alone have a higher turnover, adjusted for inflation, than BL had in its best year, 1973. Its profits, again adjusted, are 3 times what BL managed in 1969 and if you take JLRs car production figures by themselves it is making as many cars as Rover Group – with the Metro, MGF, Rover 200 etc – manged in the mid 90s. The article concludes with – The Golden age of the British motor industry? – that would be now. I couldnt put it better myself!

I am always bemused when people claim BMW kept the best bits and discarded the rest of Rover. What best bits? Do you men the unlanched MINI? This was conceived, designed and developed by BMW. It was theirs to keep! What BMW gave away for a tenner was all its front wheel drive technology with the 75 and a dowry of around £1bn to give MGR a headstart. That ended up in the Directors pension funds of course. I know your British so have to blame somebody else, especially if they are German, but in this case you really are barking up the wrong tree.

@24 the mini was engineered and developed by rover including chassis dynamics,rover also wanted it K powered only BMW said no and it ended up with the chrysler pentastar engine and diahatsa (yaris)engine.The mini was always going to be a winner so BMW kept it,no one is blaming them who wouldnt?

@24
Former Rover Engineer on the new MINI Development
The ‘Insider’ article (link below), in an issue of “CAR” magazine from July 2001, makes interesting reading………………. ‘a former Rover engineer tells at first hand the role Rover had to play in the development of the new MINI’ :

@28 first off,thank you,well said and excellent research,this is what annoyed me about BMW and its sifting through the good stuff,and people wonder why im almost fanatical about anything Rover/Longbridge.But for the shareholders BMW/ROVER could have been a major player as VAG is today,not only that BMW managers let Rover and its engineers down badly,with the launch of the 75 doomed before it went to market,which was suicidal and unforgivable.We know Rover was making losses-all car makers do at some point,BMW must have sunk circa £1billion into rover during ownership which is chickenfeed across a full car range,factories/plant/infrastructure.The Astra G cost a billion alone to develop!If BMW walked away with nothing and P4 still had the MINI,we could be talking about the demise of Fiat on here now.Business is business i know and to be fair BMW left a dowry which in any case they could afford and was the least they could do having acted like a bombay shitehawk in taking the good bits.BMW should have stuck with it.

Rickerby – July 12, 2012
“………What best bits? Do you men the unlanched MINI? This was conceived, designed and developed by BMW. It was theirs to keep!”

WHAT A LOAD OF GUFF!! As the excellent following posts prove, the new Mini was a Rover car, snuffled away by the Munich bunch. They could see a winner, proves Rover could produce a successful car.

Definition of asset stripping in the Oxford Dictionary: BMW.
Definition of incompetence in the Oxford Dictionary: Phoenix 4
Definition of shallow herd followers in the Oxford Dictionary: British car buyers

@30 well said,and as for the front wheel drive technolgy BMW didnt have any,dont forget austin/morris etc was past masters of that game.Okay,BMW had a 3 series compact development mule-rover engineered of course.What some folk forget is the brilliant engineers rover had,they made the MGF for the equivelant of a weekend on the piss,the K series and performed a miracle with the rover metro amongst other things.In germany,engineers are seen in the same light as surgeons and professors- held in high esteem,over here no-one cares a crying shame.What BMW did was a shithouse trick its beyond denial for any right minded person,and definition 3 i agree.

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